Mali eyes $9.5bn rail projects to unlock iron ore, bauxite deposits

28 October 2014

Landlocked Mali aims to diversify its mining sector away from gold with Chinese-built rail projects worth $9.5-billion that would link it to the Atlantic coast, even as slowing Chinese growth and falling commodity prices cool investment.

The West African nation – the continent’s third-largest gold producer – said last month it had signed a string of investment deals with China totalling $11-billion, with most going to rail deals. Chinese authorities, however, have not confirmed the investment.

The improved transport links would attract investors to under-explored resources such as iron ore, bauxite and uranium that are bulkier and more costly to transport than gold.

China Railway Engineering Corporation would build the Bamako-Conakry leg while China Railway Construction Corporation would be responsible for Bamako-Dakar, Soumano said. He said the parties would sign tripartite framework deals between Mali-China-Guinea and Mali-China-Senegal.

Tom Wilson, director of the Africa Practice consultancy, warned: “China has a history of pledging, in non-binding MoUs, to make major, multi-billion dollar investments in infrastructure in West Africa and failing to deliver,” Wilson said.”Chinese parastatals are not spending as they have done in the past.”

Nevertheless, some plans are already going ahead.

By: Reuters

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